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It expects to raise up to £25billion from offloading shares in Royal Bank of Scotland by the end of 2019/20.

Business leaders meanwhile welcomed the “Budget for business” which included plans to reduce corporation tax to 17 per cent by April 2020, a shakeup of business rates which will mean 600,000 small firms are exempt from April next year and tax cuts for the oil and gas industry.

CBI director-general Carolyn Fairbairn, pictured, said: “After a year of surprises, this was a stable Budget for business facing global stormy waters.

"The Chancellor has listened to our concerns about the mounting burden on firms and chosen to back business to grow the economy out of the deficit.

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The sale will repay almost £16billion to the Financial Services Compensation Scheme

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Osborne also plans to return return Lloyds Banking Group to the private sector

“Businesses will welcome the Chancellor’s permanent reforms to business rates, taking more small firms out of the regime, while the reduction in the headline corporation tax rate sends out a strong signal that the UK is open for global business investment.”

Simon Walker, director general of the Institute of Directors, welcomed plans for more spending on infrastructure across the north of England but warned: “The key with new roads and rail links is getting spades in the ground.

"Businesses in northern cities have been waiting a long time for these improvements and cannot afford to see the protracted delays we have endured on other major infrastructure, such as airports.”

Terry Scuoler, CEO of the manufacturers’ organisation EEF, said: “If there was ever a time when industry wanted to be left alone in a Budget then this is it.

"The Chancellor heeded business warnings of no major new policies which will add to costs already in the pipeline.”